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TMI Blog2013 (12) TMI 1196X X X X Extracts X X X X X X X X Extracts X X X X ..... titioner's Bank Account bearing No.030874226 which has undergone major changes (in it's Constitution) has been frozen. It is urged that as per the provisions of Sections 110 (1) of the Customs Act, 1962 (the Act), if any goods liable for confiscation under the Act are seized and a show cause notice under Section 124 of the Act is not given within six months, then the goods are liable to be restored to the person from whom the goods have been seized. It is stated that since the Bank account was frozen in July, 2011, the same is liable to be de-freezed. 3. The writ petition has been resisted by Respondents No.1 and 2. Paras 1 to 6 of the counter affidavit which reflects the stand of the Respondents are extracted hereunder:- "1. That Intelligence developed by Directorate of Revenue Intelligence, Headquarters, New Delhi, indicated that certain firms were importing high value Pesticides/insecticides /Herbicides/Fungicides from China under the guise of "Sodium Bicarbonate", "Thiony1 Chloride" and "Sodium Bromide". Therefore live consignments imported by the firms were intercepted and search operations were carried out by the DRI officials. Samples of goods stored in various warehouses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , Sambah, J&K, stock including imported insecticides/pesticides of different varieties worth more than Rs. 2 crores was detained / seized for further investigation. A rough estimate of the total value of the intercepted/ detained / seized goods is over Rs. 5 cores. A modest estimate of the duty evasion on account of mis-declaration and undervaluation (over the past one and a half years) is in excess of Rs. 4 crore. 5. That fifteen test reports of the samples of seized chemicals have been received till date and they confirm that the goods are pesticides only. 6. Thirteen samples drawn from live containers imported in the name of M/s. Umex Impex, M/s. Chopra Overseas and M/s. Mehta Overseas at ICD, Tughlakabad and Nhava Sheva have been confirmed to contain pesticides, namely Paraquat Disholride, Imidacloprid, Chlorpyriphos, Atrzine, Dichlorvos, Fipronil Buprofezine and Thiamethoxam etc. Correlation of batch number of a herbicide, "Atrazine Technical"detained at the unit of M/s Ravi Crop Science, Samba with imported goods confirmed that the said goods were mis-declared as "Sodium Bicarbonate" at the time of import." 4. It has further been stated in the counter affidavit that the im ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ustoms Act, 1962. In view of the above, it may be seen that M/s Ravi Crop Science has indulged in transfer of huge amounts to non-existent firms against the purchases of various types of illegally imported pesticides in the name of non-existent firms which were done only on paper, as detailed above. Copy of the said Account Statement from 13.08.2010 to 01.07.2011 is attached herewith as Annexure R-I." 6. It is stated that the condition of serving a notice to the person from whose possession the goods are seized is applicable to the goods which are seized under Section 110 (1) of the Act only and not otherwise. 7. Mr. Jagmohan Sabharwal, learned Senior counsel for the Petitioner while relying on the judgment of the Hon'ble Supreme Court of India in Harbans Lal v. Collector of Central Excise & Customs, (1993) 3 SCC 656 has urged that once a notice under Section 110(2) of the Act is not given within a period of six months as mandated, the goods seized are liable to be restored to the person from whose possession they were seized. It is urged that even if an extension is given for six months, the same would be invalid unless the person affected is given a notice before giving such ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nterpreting Section 110(2) proviso of the Act has held that when wanting to extend period beyond six months in respect of seizure of goods, the Collector must serve notice on and afford hearing to the owner of the goods before deciding grant of extension, as his right to restoration of his goods after six months is defeated by the order of extension. It has also viewed that where rights of a person are adversely and prejudicially affected by an order made by an authority in a proceeding, such person is entitled to a predecisional notice irrespective of whether the proceeding is judicial, quasi-judicial or administrative in nature. Earlier in point of time in Asstt. Collector of Customs v. Charan Das Malhotra (1971) 1 SCC 697 this Court observed that the Collector was not expected to propose the extension mechanically or as a matter of routine but only on being satisfied that facts exist which indicate that the investigation could not be completed for bona fide reasons within the time provided in Section 110(2) and that, therefore, extension of the period has become necessary. The Court also emphasised that the Collector cannot extend the time unless he is satisfied on facts placed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pertain to the seizure of goods. The validity of notice under Section 124, for which no period has been laid within which it is required to be given is not affected. The seizure may have, after the expiry of six months or after the expiry of extended period of six months entitled the owner or the person concerned to the possession of the seized goods. This obviously is so because the matter at that stage is under investigation. On launching proceedings under Chapter XIV, Section 124 enjoins issuance of a notice for which no period has been fixed within which notice may be given. The difference is obvious because this goes as a step towards trial. The ratio of this Court aforequoted in Charan Das Malhotra's case thus settles the question aforeposed and the answer is that these two Sections 110 and 124 are independent, distinct and exclusive of each other, resulting in the survival of the proceedings under Section 124, even though the seized goods might have to be returned, or stand returned, in terms of Section 110 of the Act, after the expiry of the permissible period of seizure." 12. Thus, it is well settled by the authoritative pronouncement of the Supreme Court in Harbans Lal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... zure of the currency, the Supreme Court held that unconditional release of cash ought not to have been allowed. In para 8, the Supreme Court held as under:- "8. However, looking into the facts of the present case, we are of the view prima facie that before adjudication, in exercise of writ jurisdiction on the facts of this case, the High Court ought not to have granted unconditional release of the cash. In fact, we called upon the learned counsel for the respondent to give a bank guarantee. The respondent is not in a position to give a bank guarantee for the amount which he had already withdrawn." 18. Similarly, in Sajjan Kumar, the bank accounts were permitted to be operated, subject to the direction that the amount received in respect of past export transactions shall not be withdrawn. 19. The instant case relates to import of certain chemicals and evasion of customs duty thereon. 20. The Respondents in the counter affidavit have stated the chain as to how the misdeclared goods were imported by M/s. VVK Traders, M/s. Mehta Overseas, M/s. Chopra Overseas and M/s. Umesh Impex and other firms and were shown to be sold to individuals against the fake cash bills and imported chemi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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